Anthony Georgiades, co-founder of Pastel, joins Cheddar News to break down the recent uptick in NFT fraud. 

Between Bells

How Rising NFT Fraud Impacts the Industry

and welcome back everyone to between balls and cheddar news and baker machado in new york and A. T scams are becoming increasingly common now in the industry that is arising ownership and sophistication of technology is making it easier now for scammers to target investors. So scammers adapt to the changing technology and now create different versions of existing N. F. T. S. This now poses a bigger danger in the complex world of copyrights. So joining us now to discuss is Anthony Georgiadis, co founder of pastel, Anthony. Such a pleasure to have you here. Thanks so much for joining us. So crypto investors are being targeted all over the country. Why is it such a struggle right now to sort of regulate this industry here? Absolutely no thanks for having me. I mean you know, first and foremost it's still very much the early stages of a hyper growth, you know, fast paced market and obviously when you have so much exuberance that's gone into play in the end of the world and you know, let's be clear, NFS are definitely here to stay. Um as the actual barriers to creating the N. F. T. S and the costs to actually minting new LFTs becomes relatively cheaper and commoditized. But the demand and growth, in terms of what people are willing to spend and pay continues to, you know, reach all time highs. Um it obviously opens up an attractive entry point in the market for scammers fraud manipulation etcetera. We've seen obviously a number of new sophisticated techniques. Obviously pure copyright infringement. Pure obviously smart contract scams in terms of changing supply constraints and things of that nature as well as just, you know, one of dupes and things of the things of the nature that have really just tainted a little bit of the image of the broader industry um and have caused a little bit of hindrance in terms of its overall long term growth, which is why something that you know, pastel has been so critical in terms of developing has been infrastructure and technology to help identify scams, to help identify duplicates to help protect users and purchasers, collectors and creators against a lot of this overall copyright infringement using the advanced deep learning methodologies and things of that nature. So sorry, Anthony let's talk about what scent is doing by the way, cassette. One of the first marketplaces to allow people to sell tweets as N. F. T. S. Has now suspended almost all of activity on the platform due to plagiarize a plagiarism related incidents here is that sort of the smart move by sent here to sort of suspend all of this because of what's happening. Yeah. You know, it's it's a bittersweet sort of situation, right? Because a lot of the foundation of this market has been built around this idea of censorship resistance right that a creator can post whatever they want however they choose to. Um and shouldn't necessarily have the discretion of a third party marketplace or anything like that if it's truly a peer to peer and truly decentralized too censorship against that and taking it down. Right. Which is why certain technologies that will power this market in the future will be powered in a way that's completely decentralized on pure peer to peer networks where there is no necessarily central intermediary that can come in and just issue a takedown. It's up for the actual network to decide and for the users and community within the network to actually make those decisions. Now in the case of scent. Right. We're obviously still in the very early stages and I think with that comes a lot of different growing pains. It's not going to be perfectly decentralized. We're going to have this level of basically intermediation to help us get to that next stage of growth and overall mass adoption. So I don't necessarily think what they're doing is wrong in the sense of I just don't think they were necessarily set up to begin with to help protect a lot of these initial entrances into the market from newer creators or collectors. That again, when you're talking about tweets and things of that nature, it's very much so frivolous with an easy, you know, copy paste type of fraud. Um, so again, do I think it's a long term solution. Absolutely not. I think it's actually a detriment to what the actual, you know, nature and foundation of this market is meant to be, but in the short term do I think it's helpful to protect, you know, holding users who might unnecessarily or unwillingly put themselves into a situation of copyright infringement or pure fraud, You know, I definitely don't think that, you know, there's many other ways for them to be handling it at this point in time. We'll do you think almost in a way this is comparable to sort of fake luxury and counterfeit goods that were being sold on amazon and a lot of these sort of marketplaces because they were having sort of the same issue with counterfeit goods as well. And they've been trying to sort of curtail that as well. Is this kind of sort of a similar situation to what we've seen there? It is um you know, it isn't it isn't right because at the end of the day, what is an M. F. T. Other than basically a token standard? Right. A unique one of whatever one of one and one of the 1001 in 10,000, whatever it might be, the content that's derived on an N. F. T. Is really subjective to the actual collector itself. And so there could be a collector in the world who's okay acquiring copyrighted or basically a, you know, ripped off an F. T. If they just like the content that's derived from it? But again, should that necessarily derive the same value? Should it be obviously marketed or attributed in the same fashion. Do they actually own And was there a transfer of that copyright, you know, from the actual initial creator themselves. Absolutely not. But at the end of the day, I do think there is a little bit of a discrepancy in terms of you know necessarily just a one off copyright basically ripped off luxury goods on amazon or things of the nature versus a true cryptographically secure N F T. That might have copyright infringed content if that distinction makes sense? Yeah, absolutely, Anthony great perspective there. I want to switch gears and talk just a little bit about the Super Bowl here because We saw 40% of the ads on the Super Bowl, we're from new first time, you know, businesses, these were sports betting companies, these were crypto exchanges. The like do you feel at the end of the day that the Super Bowl ads did a really good job of almost highlighting not just these companies, but maybe educating a lot of what the processes are like on the Blockchain for people, you know, I mean, look at the end of the day, I do think that there was a great amount of brand effort to really bring to the masses this concept of crypto of easy adoption. Obviously we saw the coin based ads, the FT X ads in a way that made it a little bit more welcoming because for so long crypto and this idea of digital assets in terms of actually going in and acquiring your own Bitcoin or ethereum on some sort of centralized exchange has just, you know, been such kind of a far off concept. Um you know, for most of you know, I think obviously, you know the Western market and you know, people who are really viewing the Super Bowl itself. So I think the way that these advertisers were portrayed in the sense of really making it easy to onboard, easy to acquire, you know, easy to hold was definitely a great job and you know, the future direction of basically reaching mainstream and institutional adoption, great perspective Anthony Georgiadis, co founder of pastel Anthony, thank you so much for joining us.